The Westgen Group of Companies held its annual general meeting in Abbotsford this week following a year that was both extremely challenging yet extremely rewarding.
“[It] was, in some ways, one of the most successful years in Westgen’s history,” Westgen CEO Chris Parry said in his report.
Group revenues totaled $21.2 million, an increase of 8% versus 2021. The gains were driven by higher revenues from Westgen’s with AgWest, Bow Valley Genetics and Cryogen.
“All of our companies performed well which is not directly shown by simply looking at the financials,” he says.
Beyond the financials, 2022 was a year of significant challenges as Westgen faced dealt with disruptions to operations following a cyberattack and flooding in 2021 as well as the higher operating costs, supply chain disruptions and changes in product mix that 2022 delivered.
“Undoubtedly, 2022 has been the most challenging year of my career as CEO,” Parry says. “It has also been a year where the strengths and weaknesses at all levels in the group were apparent.”
The operational strengths allowed Westgen to remain confident despite a $635,000 drop in the group’s net income. A recent deal to add a technology company to the group later this year underscores the operational strengths as Westgen moves beyond 2021 and 2022.
While the dairy sector’s challenges continue, sales manager Paul Meyer notes that change is also bringing opportunity.
“The continued absence of incentive days impacted the number of cows that were bred, thereby reducing the overall number of doses of semen needed,” he says. “Additionally, we have seen right-sizing of heifer inventories as a consequence to managing expenses on the farm, which reduce the semen needs for heifer breeding.”
This has resulted in a shift to sexed semen sales for beef production from dairy cattle, keeping cows lactating while not adding unneeded heifers to dairy herds. Moreover, beef sales diversify dairy farms’ income stream.
“The growth of beef-on-dairy doses as part of the sales mix continues to be the biggest adjustment for the industry to deal with,” Meyer says. “Sales of beef products have more than quadrupled since 2015, with growth since 2014 pegged at nearly 600%.”
While hopes are strong for a recovery in the dairy market in 2023, Meyer says the beef sector represents a tremendous opportunity for Westgen. This includes the ranch sector, where a growing number of producers are incorporating artificial insemination to offset live bull needs.
Bilateral agreement signed